Safeway drops credit card customers from eScrip fundraisers

SANTA CRUZ -- If your school counts on Safeway eScrip as a fundraiser, your school is about to lose thousands of dollars.

That's the word going out via Twitter and email to thousands of parents across California.

"We are worried about it because it is our biggest source of income," said Vicky Granger-Jones, president of the Scotts Valley High School Parent Club.

Monarch Alternative School in Santa Cruz, with fewer than 60 students, has been able to raise $10,000 to $15,000 a year via eScrip.

"It will be a huge hit for individual schools," said Suz Howells, president of the Santa Cruz Education Foundation, noting most of the money raised for Santa Cruz City Schools goes to classroom grants for teachers.

Safeway, which has six stores in Santa Cruz County and gave more than $20 million to schools via eScrip last year, has changed its eScrip policy.

Businesses participating in eScrip, which launched in 1999, contribute a percentage of purchases made with credit cards, and debit cards or checks with a loyalty card to schools or nonprofits designated by the customer.

As of Nov. 1, purchases made with a credit card will no longer earn eScrip contributions from Safeway.

"We have made this change because of the cost the company incurs from high credit card processing fees," Safeway spokesman Wendy Gutshall said.

"The good news is we have lifted the $25,000 cap that was previously placed on school group earnings," she added, saying Safeway plans to continue its support of schools at the 2012 level.

Parents posting on Twitter said they were notified by Safeway via email on Oct. 3 after PTA budgets were set for the school year.

Schools across Santa Cruz County promoted eScrip as a fundraiser, because it required less planning and organization than special events but raised money all year long.

Parents did not have to order anything, decorate anything or show up at an event, merely register their credit cards, designate a school as a beneficiary, and provide eScrip identification when buying groceries.

For many parents, buying groceries with a credit card was a two-for-one benefit, helping their child's school and earning airline miles.

Under the new Safeway policy, eScrip donations must be earned with a debit card, a check or SmartCheck, paying cash or using a Safeway Gift Card, WIC or SNAP/CalFresh card.

The Scotts Valley High School Parent Club hopes to persuade parents to switch to debit cards at the Safeway checkout.

"We are going to heavily advertise the switch and hope that parents do switch," said Granger-Jones.

She said parents plan to share their dismay with Safeway in hopes the grocer will reverse the policy.

A reduction imposed by Congress two years ago saved retailers saved $8.5 billion last year and they passed along $5.87 billion of that savings to customers, according to a report released last month by the Merchants Payments Coalition. However, the Electronic Payments Coalition contends consumers have not seen savings and 81 percent of stores raised prices.

Meanwhile, Reuters reported Tuesday that a handful of buyout firms, including Cerberus Capital Management LP, are exploring a deal for all or part of Safeway, the second-largest U.S. mainstream grocery store operator with a market value of more than $8 billion.